By Justin Pritchard. Banking/Loans Expert
Justin Pritchard helps consumers navigate the world of banking.
Getting Started With Credit Unions
If you’ve never used credit unions before, you may not know much about them, or you may just think they’re the same as banks. There are plenty of similarities, but a key difference is ownercredit unions are nonprofits owned by their customers. As a result, credit union loan rates often come out a little bit lower.
Becoming a Member
Before applying for a credit union loan, you have to become a ‘member’ or a partial owner of the credit union (don't worry, it's not as complicated as it sounds).
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That usually means you share some characteristics with other members (such as where you live or the industry that you or your family members work in).
No matter who you are, there's a good chance that you can join
a credit union.
To find out which credit unions are available nearby, try the National Credit Union Administration's credit union search tool. If you can't find anything local, plenty of credit unions accept members from all over the United States.
Applying for a Loan
Once you've picked a credit union, contact the institution and let them know you’re interested in borrowing money. Applying for membership is usually very quick and easy, and usually only requires that you make a small deposit to a savings account .
Once you’re a member, you can apply for a loan.
Like bank loans, credit union loans usually require you to prove your creditworthiness. The credit union needs to know that you can repay the loan. Having consistent income and good credit will help you qualify for the best loans. If you don't have either of those, start building credit and consider using a co-signer to get approved.